This Strike In Brazil Could Be A Big, Big Deal -- Look At The Numbers -- November 5, 2015

Updates

November 7, 2015: update from Reuters/Rigzone --

Brazil's state-run oil company Petroleo Brasileiro SA is increasing its effort to weaken the impact of a five-day strike, taking back control of at least two offshore oil units from striking workers. In the Campos Basin northeast of Rio de Janeiro, workers were fully or partially in control of 46 maritime units on Friday, down from 48 on Thursday.

Late Thursday, Petrobras said it had reduced strike-related production cuts to 100,000 barrels a day from 273,000 on Monday.

FUP workers began striking Sunday afternoon seeking to derail a company plan of investment cuts and assets sales that they have criticized as a plan to sell off the company to foreigners at bargain basement prices. The FUP said Petrobras is underestimating production cuts. The union has estimated that the strike is affecting 400,000 barrels of oil output a day but has declined to say which platforms or fields have suffered production cuts and by how much.

Original Post

 

The Brazilian oil strike appears to be gathering steam. Reuters/Rigzone is reporting:

A four-day strike against Petrobras gathered steam on Wednesday, cutting crude and natural gas output from the No. 2 South American oil producer and threatening to become the most disruptive walkout at the state-run oil company in 20 years.

Petroleo Brasileiro SA, as Petrobras is formally known, is expected to continue to report significant output cuts after new offshore units were affected by the strike, which began on Sunday. On Monday Petrobras said it had lost 273,000 barrels a day of crude output, or about 13 percent of its Brazilian output.

It has made no formal estimate for output since then.

The cuts have already caused the biggest strike-induced hit to Petrobras' crude output since a 32-day strike in 1995 that led to lines at gas stations and military occupation of refineries.

The latest strike is also likely to increase pressure on a company hobbled by a vast corruption scandal and struggling under $130 billion of debt, the largest in the world oil industry. "This is serious because it is happening in the midst of Brazil's worst economic crisis in decades and in the middle of Petrobras' worst crisis ever," said Adriano Pires, head of the Brazilian Infrastructure Institute, a Rio de Janeiro Energy research company.

Meanwhile, things aren't so rosy in Libya either. Bloomberg/Rigzone is reporting:

Libya’s oil output dropped below 400,000 barrels a day after the divided country’s internationally recognized government in the east closed a port run by a rival administration in the west, in a push to assert control over more energy assets and exports.

Production fell after crude exports halted at the port of Zueitina.

Libya pumped 430,000 barrels a day in October, data compiled by Bloomberg show.

Zueitina will be closed until further notice, and tankers seeking to load crude there must now register with a rival NOC management loyal to the internationally recognized government based in eastern Libya. Vessels registered with the NOC administration in Tripoli, seat of an Islamist-backed government, are “illegitimate” and won’t be permitted to load at Zueitina.